The Competitiveness of Canteens and Cafeterias Nearby University of San Carlos Downtown Campus: Industry Analysis

Chapter 3
INDUSTRY ANALYSISIn this chapter it tries to describe the external environment the cafeteria and canteens nearby University of San Carlos Downtown campus faces with political, economic, socio cultural, and technological aspects along the with the identification of the opportunities and threats to the food industry. 3.1 Industry Profile

3.1.1 ClassificationThe canteens and cafeterias nearby University of San Carlos Downtown Campus are mostly micro-sized businesses with sole proprietorship ownership that are canteens with cheaper prices. There are some outlets that are franchises of a corporation like Jollibee and Jerry’s Fried Chicken. Regarding how long the canteens and cafeteria have been in business, it is scattered from new (0-11 months), moderately new (1-5 years), moderately old (6-10 years), and old (11 years and above). The business sustainability of sole proprietorship canteens today have to compete businesses that sprouted in the years which captured their regular customers. 3.1.2 Size

Processed food sales worldwide are approximately US$3.2 trillion (2004). In the U.S., consumers spend approximately US$1 trillion annually on food, or nearly 10 percent of the Gross Domestic Product (GDP). Over 16.5 million people are employed in the food industry. In the United Kingdom, the food industry is extensive. It employs 2 million people and has a turnover in excess of £70bn. It is the largest manufacturing sector in the UK and represents around 15% of the total manufacturing sector in the UK. Around 13% of the people working in manufacturing in the UK work in the food and drink industry.

3.1.3 CompetitionThe competition of the canteens and cafeterias are among themselves because they all belong to same food industry while their indirect competitors are the internet shops nearby where in students play their shooting games or prepare for their class projects. Students with 1.5 to 3 hour breaks would take the opportunity to go to malls such as Ayala Cebu Center, SM Cebu city, or E-mall to have their lunch by jeep or on foot.

3.1.4 Key Success FactorsThe factors which give success to the canteens and cafeterias nearby are foot traffic. An establishment’s being near boarding houses and schools gives it foot traffic which is in turn can be seen as potential sales in the part of the establishment. The competitive pricing of establishments gives the customers a wide variety of food to choose from. There is good customer relationship between buyers and sellers because they are regular customers so this can be considered as a key success factor in the part of the establishment. Promotions through combo meals and contests are seen in the nearby canteens and cafeterias nearby University of San Carlos Downtown Campus.

3.2 External Factor Analysis
POLITICALThe Philippines has a volatile political history with civilian unrest, coups and attempted coups a common situation. However, since 2001 the Government, a Republic Nation with a democratically elected President, has been relatively stable albeit with continued high levels of corruption, lack of economic legislation and judicial reforms, rapid population growth, and ongoing insurgencies by terrorist and rebel groups which continue to undermine this stability.

ECONOMICALFood accounts for nearly half of an average Filipino family’s expenses and Filipino consumers generally eat five times a day. The economy in the Philippines has recovered from the 2009 recession due to government stimulus packages and a renewed trust in the government. In the fourth quarter of 2010, personal consumption expenditure (PCE), the primary driver of the Philippines economy, jumped to 7 percent. This was the highest since the 8.4 percent growth recorded in the third quarter of 1988. The country’s GDP grew by 4.5 percent in 2011, which resulted in a per capita income of US$2,012.

SOCIO CULTURAL
The Philippines is one of the world’s fastest growing and youngest...

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